Mike: O2/Voda battle royale


The battle for share next year will be between the current market leader and the current number two.

O2 will be ready to splurge in the New Year, as its financial year turns. Vodafone appears to be saving the pennies now, in order to do as well as it can to meet O2 head on when January breaks. Seasonal surges and withdrawals are hardly new. T-Mobile used to blow its acquisition budget by September every year.

But the ground marked for battle is different now. O2’s hugely ambitious plans for its fixed line proposition demonstrate enormous desire to expand its revenue streams.

Mobile is limited, with voice and text revenue declining. Fixed line is perceived, ultimately, by both O2 and Vodafone as a way to harden customer loyalty, and entrench the operator brand in customers’ lives.

Vodafone has spoken in these pages of its unified communications propositions One and OneNet, for the corporate and SME spaces respectively.

And the sense the industry has is Vodafone has the right senior management in place at last, realistic to accept their employer’s position as number two – and soon number three – in the UK.

Orange/T-Mobile, in waiting, will be swamped with the minutiae of corporate integration through the first of 2010 to do much more than hold on to its 37 per cent share.

O2 will be aggressive. Vodafone must move more quickly.